Saturday, January 2, 2010

Brookfield gets $200M for 90 per cent of Washington, D.C. office property

NEW YORK - Brookfield Properties Corp. (TSX:BPO) has sold interests in two office and commercial properties in the Washington, D.C., area for net proceeds of $103 million, the Toronto headquartered company said Wednesday.

In one deal, Brookfield said it had sold a 90 per cent interest in an office property in Washington, D.C., to a group of investors represented by Edge Fund Advisors for $203.4 million.

Brookfield retains a 10 per cent interest in the joint venture with Edge Fund, a D.C. real estate investment adviser and asset management firm, that was acting on behalf of HSBC Alternative Investments Ltd. and an exclusive syndicate of HSBC Private Banking Clients.

The price for the 90 per cent common membership interest in the building at 1525 Eye St. in Washington's central business district amounts to $587 per leasable square foot. The 12-storey, 36,000-square-metre building was acquired by Brookfield in 2003.

Besides retaining its 10 per cent common membership interest as well as a preferred interest in the venture, Brookfield will retain property management and leasing responsibilities at the building.

"This joint venture allows Brookfield to realize an attractive return on investment and increase our liquidity profile," Brookfield Properties CEO Ric Clark said in a news release.

"The ability to maintain an ownership and management interest in what we believe to be one of the finest commercial properties in Washington, D.C., is a key facet to the partnership with Edge Fund."

In a separate transaction, Brookfield also sold One Bethesda Center, a 15,800-square-metre building in Bethesda, M.D., to JBG Associates LLC for an undisclosed price.

"The two transactions generated approximately $103 million in net proceeds for Brookfield Properties," the company said.

Brookfield Properties owns, develops and manages premier office properties in a number of major cities in North America. Its current portfolio is comprised of interests in 108 properties totalling almost seven million square metres. In the metropolitan Washington, D.C., area it owns, operates and manages 30 commercial properties totalling some 687,500 square metres.

Brookfield shares were up seven cents at $13.22 Wednesday on the Toronto Stock Exchange.

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